Optimizing in 2004

With industry watchers estimating IT spending to increase by as much as 8% in 2004, now is the time for enterprise IT managers to determine the best ways to better their networks. Technology wish lists include hardware and software that make nets run faster at lower cost.

IDC says spending could go up 8% while fellow analyst firms Gartner and Forrester see more modest increases of 5% and 4%, respectively. The trend will be to upgrade infrastructure and give more attention to business applications than in the past few years.

Attendees at the recent Gartner Data Center Conference in Las Vegas were eager to look at technology, not just as a means to cut costs, but also to increase efficiencies and boost business value in the data center, according to the research firm.

“Such a large portion of IT budgets is spent on maintaining what they have, the legacy workloads,” says Mike Chuba, vice president and research director at Gartner who chaired the conference. “Good economy or bad economy, anything that you, as an IT operations director, can do to make your environment more efficient has tremendous payback. There is tremendous interest in looking at new processes, at new vendors with innovative solutions, and just general knowledge about the vendors in the IT operations space, as this is a space with an extremely large number of vendors with ‘point’ solutions.”

Forrester Research also hosted an event looking ahead to the coming year. The firm says that while no innovative new technologies will be topping users’ lists of must-haves, IT buyers will be looking to do more than simply cut costs.

“One of the key traits of technology innovation right now is finding things that are cheaper, faster, more effective and more efficient,” says Andrew Bartels, a vice president at Forrester. “Blade servers, Web services, Linux; all of those have the characteristics of being cheaper. In 2004, it’s not that there is a new must-have technology; the innovations in IT are around making it cheaper easier to operate and faster.”

Forrester estimates that spending will increase about 5% on technologies such as storage and server hardware. Integration software and enterprise portals will also see more activity in 2004 than in 2003. IP telephony, enterprise content management, and mobile and wireless tools will also get more attention from IT buyers. Business intelligence software, collaboration tools and e-learning applications could see more sales as well.

Another area that IT managers will be paying close attention to is risk management, compliance software and as always security, Bartels says.

Senior Editor Jennifer Mears contributed to this newsletter.